Ottawa contractors see new opportunities constructing coach houses

Construction of Ottawa’s first coach house is underway, and builder Ottawa General Contractors (OGC) is hoping the discrete form of infill represents a big market opportunity.

“We think that this could be a huge hit in Ottawa,” says Fares Elsabbagh, president of Canadian General Contractors Group, which includes OGC.

City council passed its approval on coach houses back in October, allowing homeowners to construct small, self-contained accessory apartments that are detached from the primary dwelling, but on the same lot.

It includes several restrictions, including height limits, a maximum size set in scale to the original home and a minimum lot size. In order to build a coach house, you’ll need a permit from the City of Ottawa.

The appeal of the smaller units is in a more discrete form of intensification. In asking for public feedback on coach houses a year ago, the city said the infill option would provide “opportunities to introduce more dwellings in established neighbourhoods while maintaining the character of those neighbourhoods,” while also supporting the city’s goal of providing a diverse housing supply.

In a blog post, associate lawyer David Reid of Brazeau Seller LLP’s real estate department wrote that developers may want to consider the possibility of homeowners building coach houses when determining lot specifications in a new subdivision.

Mr. Elsabbagh says that with rising real estate prices, coach houses are appealing for several reasons, including affordable housing options for millennials and in-laws, or as an extra income property. The project OGC is building now is a 500-square-foot unit for a client to move into on her mother’s property.

OGC builds coach houses at a rate of $250-300 per square foot, bringing the cost of most units below $200,000.

“When millennials get into the buying age, with the cheapest house right now going for $400,000, it’s going to become unaffordable for them in the next decade,” Mr. Elsabbagh says of coach houses’ potential.

The company is looking at ways to bring costs down, however, including modular builds. Reducing weather-related costs with offsite construction can immensely help profit margins when it comes to Ottawa infill.

He adds that lenders are likely to be interested financing coach-house construction, especially if it will be used as a revenue-generating property.

“Any time you can show some kind of income, that’s a good thing, whether it’s your personal income or an income suite.”